Millennials fail to grasp the cost of credit cards

MILLENNIALS applying for their first credit card do not know they have to pay interest, an expert has warned.

Moneysupermarket, a price comparison website, revealed that youngsters applying for a credit product often have “no understanding” of what they will have to pay back, but often get sucked into the idea of credit cards as a way of buying things they cannot afford.

Kevin Pratt, from Moneysupermarket, said credit cards were a “minefield” for many millennials. He said: “We have evidence that when credit cards advertise as having zero per cent interest, often for a fixed period, or something similar, young people think that all you will pay off is what you’ve spent.

“They have no understanding and think it’s a card that is free to use – but as most of us know if you don’t pay the money back you’ll start paying interest and that can snowball.”